Landlord Association Forums: For Landlord Professionals

We contacted our partner Equifax Canada and spoke with them about the safe and legal way for landlords to conduct tenant credit checks.

The Equifax Service Agreements that “friends” (who are pulling on behalf of landlords) explicitly requires that the consumer credit files from Equifax Canada Co. are for their exclusive use ONLY. They are clearly restricted from sharing with other entities. Federal disclosure legislation (PIPEDA) also defines the requirements for true and accurate disclosure to a consumer as to whom their personal information has been provided.

This practice is a breach of the Agreement and clearly puts their membership w Equifax at risk. There are no jurisdictions in Canada where this practice is allowed, no exceptions.

Always use a certified tenant credit checking company such as Equifax, TVS, or GARDA.

Here are our questions and the answers that follow:

1. Can I Call my Relative or Friend To Do the Credit Check For My Potential Tenant?

If the landlord uses a mortgage agent, Realtor, etc. to access potential tenants credit data for them, and the tenant didn’t agree and these tenants contact Equifax what will happen?

What are the penalties that could occur?

ANSWER FROM EQUIFAX

Can I Call my Relative or Friend To Do the Credit Check For My Potential Tenant? The answer is No.

Given the nature of the existing credit reporting/privacy legislation and the terms of use (agreement) by the Equifax member, the consumer can report this type of unacceptable activity to the Ministry of Consumer Services, who will then investigate.

Any inappropriate use or breach of contract could lead to termination of membership with Equifax.

2. Mortgage Agents, Realtors, Insurance Agents, Car Dealerships

Several landlords say they have used friends who are mortgage agents, Realtors, etc. for years to access tenant credit data and nothing happened and there is nothing wrong using this method to obtain credit data on potential tenants.

What is the best response to their claims?

ANSWER FROM EQUIFAX

See above and below for more details.

Equifax must disclose the actual entity that received the file.

3. What About Third Parties to Obtain Credit Data?

Some landlords have a waiver on their application form saying they will use a “third party” to obtain credit data on a potential tenant (they don’t say who will do the check, only that it will be a third party).

They then contact a friend who is a mortgage agent, Realtor, insurance broker, someone who works at a car dealership, etc. to do the credit check on the potential tenant for them.

They wonder if the waiver clause allows them to use a ‘friend’ is okay.

ANSWER FROM EQUIFAX

The service agreement signed by EACH of our members clearly articulates that they will not “share” a credit file with another entity: the credit file is for their exclusive use ONLY.

Any entity that does share is in violation of this agreement.

4. Tenants Complaining About Unauthorized Credit Checks

Some tenants complain they have a ‘credit hit’ on their credit reports from mortgage agents, insurance agents, etc. which they never agreed to (as they only wanted to rent an apartment).

How can tenants get these unauthorized credit hits off their records?

ANSWER FROM EQUIFAX

Due to privacy legislation, once Equifax delivers a file to a member, we MUST post an inquiry (by law).

As such, we do not remove these inquiries as they are factual and the consumer has a legal right to know their file has been disclosed.

5. What Can Tenants Do?

Some tenants who have credit hits from people they never authorized have asked if they should contact the Ministry of Consumer Services to make formal complaints that their credit data was obtained fraudulently. They would like advice on this.

ANSWER FROM EQUIFAX

Yes, they should contact the Ministry of Consumer Services who will launch an investigation.

They can reach also reach Equifax directly at the following telephone numbers to lodge a complaint and we will do an investigation:

English: 1-866-828-5961

French: 1-877-323-2598

6. What about Mortgage Agents/Brokers or Real Estate Agents who help a friend by checking a potential tenant's credit for them?

ANSWER FROM EQUIFAX

The Mortgage Agent/Broker or Realtor risks losing their entire firm from doing credit checks. It's a huge gamble and something they should not do.

The penalties are extremely serious for their company.

Landlords must use Verified Tenant Credit Check companies.

Read more at:

http://ontariolandlords.org/blog/ontari ... it-checks/